"We have a breadth and depth of experience to help them through difficult situations.

"In overall terms of our business, year on year fee income will probably be up which is surprising."

However, he says this is not across the board.

"The decline in M& A and inward investment activity has clearly had an impact on our tax practice.

"As the deals truck down our M& A practice has had less activity.

That has been more than compensated for by the uptake in restructuring, business turnaround and debt advisory.

During the past 12 months PwC has been recruiting new partners in Scotland, including Mike McCusker, a tax partner from Grant Thornton, to bolster its family business and private companies practice. Blin says more announcements are in the pipeline.

"We are appointing at least six new directors and will recruit around 70 graduates this year which is similar to previous years," he says.

Nevertheless Blin concedes profitability will drop this year because of market pressure and lower volumes and activity but also as a result of investing in partners and staff.

"We could have not recruited more people but we have because we are a long term business," he says.

Blin says PwC has benefited from a buoyant oil and gas sector and it still gets substantial business from the country's PLC base.

Despite the crisis which has crippled the country's two major banks Blin says the financial services sector remains a major source of work for PwC.

"The financial services sector clearly has changed significantly but we have got the largest by far services practice in financial services with over 25 actuaries employed by PwC," he says.

Deloitte, which is ranked third of the Big Four on Insider's 2009 league table, is seeing a rise in distress acquisitions replacing the stalled pure M& A activity. The frozen debt markets have stalled pure M& A activity and severely affected private equity, because deals can't be leveraged. However distress acquisitions are on the rise.

"What we have seen in the last three to four months is a shift towards what we would call special situations," explains James Baird, Deloitte senior partner for Scotland and Northern Ireland. "These are transactions that effectively have to happen, to respond to a company's financial position rather than provide growth.

It could be securing new debt or securing debt from a different bank. It could be advising on the whole debt package of a business - our debt advisory team is very busy - or looking at corporates where some bits are cash generative and others aren't. One way of financing a business like that might be to split it up and sell off parts."

Deloitte has reallocated staff from quiet to busy practices to avoid redundancies and is keeping senior recruitment tightly managed. But graduate intake won't be affected.

"It's the classic easy thing to cut, but it's just a foolish measure," Baird says. "If you cut now at the lowest level of intake, in three years' time you won't have any qualifieds."

Corporate cost-cutting has impacted on discretionary client spending as projects such as enterprise and IT system upgrades are put back or shelved.

Any cash that is being spent is focused very much on cost reduction and cost control. In Deloitte's most recent quarterly survey of chief financial officers, around 80 per cent were focused on cost reduction.

Audit, tax, compliance and recurring business are holding up well, albeit at lower growth rates than in previous years. Baird anticipates the post-crunch regulatory regime and warns against excessive red tape.

"It doesn't always make sense to have a rule for everything, to stop it happening," he suggests. "We need the financial system to keep going."

Asked what his experience tells him about the current climate, Baird responds: "When you go to the bank to ask for more time or money and the bank itself is having to ask its own questions about whether it can put more money into the system, that changes the whole situation.

"Have I been through it before? Yes. But in this situation, we're all learning."

Kpmg has taken a tougher line on internal cost-cutting and announced in February that it was offering a voluntary four-day working week and sabbatical of up to three months in anticipation of falling demand for services. The firm saw 85 per cent uptake of the scheme, called 'Flexible Futures', which has now been implemented in the tax practice.

"No-one wants a pay cut, but they'd rather have job security," says Craig Anderson, head of KPMG in Scotland. "It's fortunate it's happened when the weather has improved, the light nights are here and free time seems more appealing.

"That's a success, but it's the beginning of a programme that will run through to December 2010."

Anderson describes business as a "tale of many parts". Restructuring is very busy, as is audit, due to additional work required to sign-off accounts this year because of uncertainty in economic outlook and availability of bank finance. Deal activity has dropped off, but forensic accounting is strong as people look to extract cash from deals that may be failing to live up to expectations.

"When the tide goes out, rocks begin to show," Anderson says. "People are re-examining deals done in more buoyant times and looking at warranty claims (provided by the vendor) in more detail than they would have done in the past.

"If trading declines, it's possible these warranties will result in claims as acquirers try to get some of the proceeds back."

Anderson qualified in 1982 and has seen downturns before, but feels this one is particularly notable for its information time lag.

"Everyone I was working with in April and May 2008 and possibly the tail end of 2007 was saying that things felt different," he explains. "But I think it was November 2008 before the government announced we were in recession.

"That brought home to me the lag in reporting official statistics and how reports of the country's financial position and economic strength lagged reality.

"The message I'm giving to clients and staff is that, when things start to feel better, regardless of what the news or official reports are saying, things probably are better."

In second place on Insider's league table, Ernst & Young announced in March that it had identified 12 potential redundancies, eight in Glasgow and four in Edinburgh.

"The name of the game is to be as flexible as possible," says Hywel Ball, managing partner in Scotland for Ernst & Young (E& Y). "We looked at staff around the practices and found over-capacity in small areas."

Restructuring, as in other firms, has been busy, with administrations including Oilexco and the subsequent sale of its UK assets to Premier Oil. Clients are also investing in tax planning, working capital reviews and cost reduction advice.

Ball says all partners have been keeping close to clients and spending time talking to companies about where they are on the 'stress pendulum' and about possible solutions.

He compares the current climate to a caution period during a Formula One race, when a major accident or obstruction on the track prompts the arrival of the safety car ahead of the leader to slow everyone's speed.

"All the organisations are currently bunched together behind that safety car," he suggests. "In that period there's a lot of jostling for position and a lot of things can happen. Whoever's in the best position when that safety car goes back off the track will be in an incredibly strong position when the upturn comes. There's actually quite a big opportunity to take genuine market share."

Ball believes the rate of decline is starting to slow and there is potential for green shoots of recovery.

"The question is whether it will resemble a U-graph (a rapid upswing) or a bathtub (with a flat base)?" Scott-Moncrieff, tenth on Insider's 2009 table, aims to get through the recession without a firm-wide redundancy programme and has stopped taking on speculative projects which may run into trouble and jeopardise fee payment.

Some staff are also being redeployed or retrained. Since Christmas, the firm has seen a real tightening of cash and a loss of confidence.

"Many of our clients are seeing the ageing of their debtors' book worsening," explains Scott-Moncrieff managing partner Nick Bennett.

"A lot are having to deal with issues and problems they have not experienced before - 'what do I do if my main suppliers go bust, what do I do if mymain customers stop paying me?' "Having said that, we have a lot of clients with funds who are equally worried about where is the safest place to put their money and where they can get the best returns."

Scott-Moncrieff' s IFA business has also been affected by the loss of investor confidence, although Bennett. expects these areas to bounce back sharply when the recovery comes. A particular area of growth has been specialist VAT advice.

"Clients now see maximising the recovery of VAT and loss to HMRC as critical," Bennett. says. "Some are using this breathing space to undertake VAT health checks to make sure they are in a fit condition for the market recovery."

Asked how he sees the future shape of Scotland's accountancy sector, Bennett. warns that firms charging unsustainably low rates will only hurt themselves.

"A number of firms are compromising themselves by low-balling at commercially unsustainable rates," he says. "It is impossible for them to deliver even an average service at this level.

"They will ultimately sully their own reputation and reputation is very important in the Scottish accountancy market.

"Whilst, at the moment, some companies want the cheapest possible service, in the longer term quality will reassert itself and those who have maintained their reputation for quality will ultimately benefit."

French Duncan, at 12th place on Insider's table, picks up this theme.

"We're under a little pressure from clients to look at what we're charging," explains managing partner RobertKerr. "That's been brought about by people who have been employed as financial directors of companies, have been made redundant and have suddenly set themselves up as accountants. Then they go and approach a few of our own clients .

"We do a fair bit of outsourcing for clients and, to be perfectly honest, these guys can do it a lot cheaper, because they're working from home and have no overheads. The problem clients don't see is that it's a one-man band and if that person is offsick or something happens to him, where do they go?" The firm has just opened a new insolvency division in Edinburgh, timing that Kerr believes is spot on.

"In the past we didn't get to lead on big corporate stuffbecause the banks would always put in one of the big four firms," he says. "But I think they're now realising that the Big Four charge like the light bri-gadeso there's nothing leftfor the small creditors, who are ultimately customers for the banks.

"If they put in a mid-tier firm as opposed to a Big Four firm at least their customers are now getting some money back."

At Anderson Anderson & Brown (AAB) in Aberdeen - 14th on Insider's table - fee incomewas up 13 per cent in the year toMarch 2009. Managing partnerMike Brown attributes this to the relatively benign North-East economy.

"Generally speaking, business in Aberdeen is buoyant," he says. "We are seeing the impact of the banks' lack of lending; the lack of movement in banking markets is definitely slowing things down.

"I think Aberdeen is cushioned by the oil industry. It is under a little pressure because of the oil price dropping into the low forties, although the rise back into the fifties is encouraging.

"Compared to the rest of the UK we don't see the same severe downturn in business, but we've seen a gentle quietening of business."

Changes to capital gains tax last year kept AAB busy with disposal mandates but this year is more about restructuring and refinancing. The firm's two strategic planning specialists are particularly busy.

"A company's business plan might have been formulated two years ago, but the business has changed dramatically just in the last six to nine months, so it's not valid anymore," Brown explains. "The management team then has to get together again and decide where the business is and where they can take it given the current economic conditions.

"In the past we've done lots of financial projects for people and then let them go. Now we're asking, 'Do you knowhow you're going to do this?' and helping people with short-term tactical plans as well."

Brown was aroundwhen the oil industry was going through a hard time in the mid-1980s, but has never seen anything like this before.

"The bankswere in a much better position to help back then. It's a double whammy this time.

"The oil industry is quiet-ish now, butwhenwe feel the impact of that reduced activity, the bankswon't be able to help, so the situation ismuch more dangerous than before."

FUTURE CHANGES

Insider's survey asked what in the next two years do you expect to see: